Money Transmitters

Extracted from: Internet Gambling in Nevada: Overview of Federal Law Affecting Assembly Bill 466,
Courtesy of Liebert Publishing, Gambling Law Review

[The text of the statute follows Mr. Rodefer's comment]

Congress, concerned that those engaged in money laundering were using money transmitting services rather than traditional financial institutions, passed the Illegal Money Transmitting Business Act of 1992, [253] codified at 18 U.S.C. 1960.  The Act provides that it is a crime to conduct, control, manage, supervise, direct, "or own all or part of a business, knowing the business is an illegal money transmitting business." [254] The term "illegal money transmitting business" is defined generally to mean a money transmitting business that affects interstate commerce in any manner and fails to comply with either state law or the registration requirements for such a business under 31 U.S.C. § 5330. [255] Possibly more troubling for the operators of on-line gaming is the definition of "money transmitting," which "includes but is not limited to transferring funds on behalf of the public by any and all means including but not limited to transfers within this country or to locations abroad by wire, check, draft, facsimile, or courier." [256]

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End notes:

[253]    See Illegal Money Transmitting Business Act, Pub. L. No. 102-760, § 1512(a) (1992).

[254]    18 U.S.C. § 1960(a).

[255]    See 18 U.S.C. § 1960(b)(1).

[256]    18 U.S.C. § 1960(b)(2).

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United States Code; Title 18  Part I  Chapter 95
Sec. 1960. - Prohibition of unlicensed money transmitting businesses

(a) Whoever knowingly conducts, controls, manages, supervises, directs, or owns all or part of an unlicensed money transmitting business, shall be fined in accordance with this title or imprisoned not more than 5 years, or both.

(b) As used in this section -
(1)  the term ''unlicensed money transmitting business'' means a money transmitting business which affects interstate or foreign commerce in any manner or degree and -

(A)  is operated without an appropriate money transmitting license in a State where such operation is punishable as a misdemeanor or a felony under State law, whether or not the defendant knew that the operation was required to be licensed or that the operation was so punishable;

(B)  fails to comply with the money transmitting business registration requirements under section 5330 of title 31, United States Code, or regulations prescribed under such section; or

(C)  otherwise involves the transportation or transmission of funds that are known to the defendant to have been derived from a criminal offense or are intended to be used to be used [1] to promote or support unlawful activity;

(2)  the term ''money transmitting'' includes transferring funds on behalf of the public by any and all means including but not limited to transfers within this country or to locations abroad by wire, check, draft, facsimile, or courier; and

(3) the term ''State'' means any State of the United States, the District of Columbia, the Northern Mariana Islands, and any commonwealth, territory, or possession of the United States
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[1] So in original.